Beyond the Tables: Measuring the Impact of Non-Gaming Diversification on Casino Profitability in Macau

Qizhou Luo () and Shunfeng Song
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Qizhou Luo: College of Business, University of Nevada, Reno, NV 89557, USA
Shunfeng Song: College of Business, University of Nevada, Reno, NV 89557, USA

Tourism and Hospitality, 2025, vol. 6, issue 2, 1-20

Abstract: This study investigates the relationship between diversification and profitability in Macau’s gaming firms, offering quantitative evidence from the world’s largest gambling market. Compared to other major gambling hubs such as Las Vegas, Macau’s gaming companies generate higher revenues but exhibit significantly lower levels of diversification, highlighting an urgent need for strategic expansion beyond gaming. Drawing on governmental data and company financial reports issued from 2010 to 2019, this research employs a combination of case study analysis, linear regression modeling, and bootstrapping techniques. The findings reveal that an increased share of non-gaming business significantly enhances profitability metrics, including net profit margin, return on assets, and a firm’s profit share within the overall gaming market. These results offer valuable implications for the development of corporate strategies, regulatory frameworks, and future academic research.

Keywords: gaming; diversification; Macau; China; casino; profitability (search for similar items in EconPapers)
JEL-codes: Z3 Z30 Z31 Z32 Z33 Z38 (search for similar items in EconPapers)
Date: 2025
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